Red Sea Wind Energy has secured a senior secured loan of up to US$100 million from the European Bank for Reconstruction and Development (EBRD) and the Green Climate Fund (GCF) for the development, construction and operation of a new onshore wind turbine of 500 MW in Egypt.
Egypt embarks on energy transition with Africa’s largest wind farm
The project, located in the Gulf of Suez region, is to be the largest wind farm in Africa. It is part of the country’s commitment to transition to clean energy, reduce carbon emissions and meet its renewable energy target. The energy produced will be sold to the Egyptian electricity transmission company over a 25-year period.
This project is the first under the Energy pillar of the National Platform for Water, Food and Energy Nexus (NWFE) program in Egypt, which aims to deploy an additional 10 GW of renewable energy capacity between 2023 and 2028. The program was launched by the Egyptian government at COP27 with many institutions, including the EBRD as the lead development partner for the Energy pillar. It will help create new green business and employment opportunities, reduce pollution and avoid CO2 emissions, thereby promoting a fundamental shift in Egypt’s dependence on hydrocarbons.
The loan consists of up to US$50 million from the EBRD and up to US$50 million from the GCF, co-financed by the Japan Bank for International Cooperation and private commercial banks insured by Nippon Export and Investment Insurance.
Strengthened international cooperation for the development of an onshore wind farm
The project marks the first co-financing between JBIC and the EBRD since a memorandum of understanding was signed in October 2022 to strengthen cooperation between the two organizations. In addition, this is the first joint project between NEXI and EBRD since the signing of a Memorandum of Understanding in October 2020.
The wind farm will be built, owned and operated by Red Sea Wind Energy S.A.E., which is owned by a consortium consisting of ENGIE, Orascom Construction, Toyota Tsusho Corporation and Eurus Energy Holdings Corporation.
The project, which reached financial close on April 3, 2023, is a major milestone for the Red Sea Wind Energy consortium. This is the second wind farm in Egypt and will triple the consortium’s wind power generation capacity in the country to 762.5 MW. The plant will be connected to the power grid in two phases and full commercial operation is planned for the third quarter of 2025. The wind farm project is helping to accelerate Egypt’s transition to renewable energy generation and will provide clean energy to more than 800,000 Egyptian homes.
